§ 9-502. Examinations; audits; investigations; special reports

   (a) Examinations. --

   (1) (i) At least once every year and at any other time that the Division Director considers appropriate, the Division Director shall have an examination made into the business of each savings and loan association not insured by the Federal Savings and Loan Insurance Corporation. The costs, as computed by the Division Director, of any examination made by the Division Director shall be paid by the association.

      (ii) As to a savings and loan association insured by the Federal Savings and Loan Insurance Corporation, the Division Director shall have an examination made into the business of such association at such time as the Division Director considers appropriate, but at least every 18 months. The costs, as computed by the Division Director, of any examination made by the Division Director shall be paid by the association.

   (2) (i) Within 2 months from the completion of every examination, the Division Director shall communicate in writing the result of the examination to the president of the association examined and to each member of the board of directors of the association.

      (ii) The board of directors shall promptly report corrective action taken to the Division Director and the State of Maryland Deposit Insurance Fund Corporation or the Federal Savings and Loan Insurance Corporation, as applicable.

   (3) The directors, officers, controlling persons, employees, and agents of the association shall exhibit its books, accounts, papers, and records to the Division Director in order to conduct the examination of the association. A savings and loan association may not delay or obstruct an examination in any fashion.

(b) Audits. --

   (1) At least once every calendar year, every association shall have its books and records audited and certified in accordance with generally accepted auditing standards by a certified public accountant who is in good standing under the laws of this State or a certified public accounting firm, according to the American Institute of Certified Public Accountants (AICPA) guidelines. Any person or firm who is currently suspended from practice before the Securities and Exchange Commission or other governmental agency is not qualified for purposes of this subsection.

   (2) If an association makes written application to the Division Director showing reasonable cause, the Division Director may extend in writing, within 30 days after receipt of application, the time for compliance with this audit requirement.

   (3) The audit shall commence no later than 30 days after the end of the period for which the audit is prepared. The audit shall be completed within 60 days after the date on which it is commenced, unless the association makes written application to the Division Director, showing reasonable cause for an extension and the Division Director extends the time for completion.

   (4) Each association shall cause a copy of the certified audit report to be furnished to the Division Director within 30 days of the completion of the fieldwork of the audit. The certified audit shall include any supplemental reports that are an integral part of the audit report.

   (5) The costs of the audit required by this subsection shall be paid by the association.

(c) Substitution of federal examination or audit. --

   (1) Instead of an examination or audit under subsection (a) or (b) of this section, the Division Director may accept a copy of a reasonably recent examination or audit made or accepted by a federal home loan bank, the Federal Home Loan Bank Board, or by the Federal Savings and Loan Insurance Corporation.

   (2) A substituted audit under paragraph (1) of this subsection shall be signed and certified by the auditor.

(d) Investigations; special reports. --

   (1) The Division Director may:

      (i) Make any further investigation of a savings and loan association;

      (ii) Require any other report from an association, including an appraisal of assets, that the Division Director considers necessary; and

      (iii) Investigate any related entity.

   (2) If an appraisal of assets is not done in a manner satisfactory to the Division Director, the Director may cause an appraisal to be made at the expense of the association.

   (3) The Division Director may accept any appraisal caused to be made by the federal home loan bank, the Federal Home Loan Bank Board, the Federal Savings and Loan Insurance Corporation, or by the State of Maryland Deposit Insurance Fund Corporation.

(e) Books and records. -- All books and records of an association and any related entity shall disclose fully and accurately all of the assets and liabilities of the association and any related entity.

(f) Report to Secretary. -- The Division Director shall inform the Secretary of any significant issues about a savings and loan association that are disclosed in an examination or audit.

HISTORY: An. Code 1957, art. 23, § 161CC; 1980, ch. 856; 1986, ch. 5, § 1; ch. 282.